Silver Certificate Redemption Set at $5
■ Was there ever a maximum redemption amount set on redeeming bank notes for silver prior to the withdrawal of the Silver Certificate?
A maximum legal tender amount of $5 was placed on redeeming Greenbacks for silver through the Specie Payment Resumption Act of 1875. Silver, already declining in intrinsic value, fell even further due to this legislation while the value of gold appreciated.
■ How were Silver Certificates to be redeemed for silver?
Individuals redeeming small amounts such as several $1 notes initially received a silver dollar. Later, dollar silver granule packets containing 0.773 troy ounces of silver (the same amount as in a silver dollar) or small silver ingots stamped with the seal of the San Francisco or New York Assay Office were used. Larger amounts were redeemed in large, flat, rectangular ingots on which the troy ounce weight was written in black grease pencil. There may have been other similar ways of redemption of which I am unaware.
■ When did redemption of Silver Certificates for silver end?
Public Law 88-36 passed on June 4, 1963, repealed the Silver Purchase Act of 1934 as of March 1964. The same law confirmed Silver Certificates could be redeemed for either silver dollar coins or for bullion at a rate of $1.2929 per ounce until the 1964 redemption deadline.
■ I’ve noticed there are more $5and $10-denomination Military Payment Certificates (MPCs) that are rarer than any other denomination throughout the series. Is there a single reason for this?
The military paid in cash on “pay day” during this period. The men lined up to receive their pay in either U.S. bank notes or MPCs, depending on if the troops were in a war zone or not. As an example, if the soldier was to receive $150, it would be paid out in seven $20 notes with one $10 to complete the payment. For this reason, the $5 and $10 denominations weren’t issued in as great of numbers.
■ Were Military Payment Certificates convertible to U.S. currency?
MPCs were convertible to U.S. dollars when a soldier or authorized non-military personnel was leaving an MPC zone. While local merchants often accepted MPCs, it was illegal for these merchants to redeem them for U.S. dollars. The objective was to prevent profiteering by military personnel in local black markets.
■ Military Payment Certificate series were changed 13 times. Couldn’t a solider have bought back MPCs from local merchants at a deep discount if he knew a change was coming and the local merchant wouldn’t be able to make an exchange himself before the older series became worthless?
Conversion or C-Day was kept secret until the actual date all outstanding MPCs were to be converted or be deemed valueless. On the actual C-Day, all military personnel were restricted to base in an effort to avoid such a situation. How effective this was in reality is unknown. I have heard stories of soldiers discounting MPCs bought from local merchants for that reason.